Grace Ferguson’s fine reporting on luxury housing policy is welcome in a city suffering through both a housing shortage and dramatically higher rents.
I take issue with those who say that luxury housing can help reduce rents. And I certainly take issue that the city has enough affordable units. While adding luxury units to the housing stock may alleviate pressure on the market, there’s no guarantee that more affordable units will be available as a result.
The commuter rail will attract people from outside the region. Given affordability issues in greater Boston, I suspect the immigration will be more than city officials think. They’ll be more likely to afford New Bedford’s luxury rentals, which will look like bargains compared to prevailing rents close to Boston.
As this knowledge spreads, it will attract more investment, more units and more outsiders seeking these bargains. This higher demand will likely result in higher luxury rents. These new residents won’t be leaving a New Bedford apartment vacant for a young couple or family to rent. Given what’s in New Bedford’s future, a trickle-down luxury housing approach isn’t the answer to New Bedford’s problems.
Cities with much greater affordability problems have utilized inclusionary zoning to increase the number of their affordable units. Whether it’s 5%, 10% or some other figure, this zoning requirement will use the luxury market as an engine of affordability.
What do I mean by affordability? In this case, middle income housing must be encouraged: individuals or families with incomes between 80-120% of the city’s median income should be the target. This group has largely been overlooked by developers.
New Bedford has done far more than its fair share in producing low-income housing. Frankly, Acushnet, Rochester, Freetown, Mattapoisett, Marion and Westport have all fallen far short of the 10% low-income target that is state law. This suburban resistance has done damage by driving subsidized developers into the city where the uses are allowed. New Bedford’s continued commitment to low-income housing cannot be questioned.
What is needed now is housing that’s affordable to middle income families. Public subsidies might be available to promote this production, but inclusionary zoning targeting luxury housing is a far more efficient way of bringing these units to market.
New Bedford’s housing market will certainly get hotter with the arrival of the commuter rail and luxury development will surely accelerate. The city should use every tool in its toolbox to promote the production of affordable units. A trickle-down housing policy for luxury housing is too passive an approach. Inclusionary zoning is a much more direct and fruitful policy.
Richard Walega served as city planner in New Bedford from 1977 to 1983.
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I’m a little less confident than Mr. Walega that a ~90 each way commuter rail with limited frequencies is going to attract a large enough influx of new, out-of-town renters to cause a dramatic increase in overall rents. I’m also not convinced it needs to be either/or when it comes to market rate rentals and affordable units. It should be both/and. Incentivize/encourage affordable housing development and reduce procedural speed bumps for developers who want to build market rate. The city will benefit from having both.
I agree with mayor Mitchell’s comment above. I suspect zero chance that a “both/and” policy would be executed in bad faith and produce nearly all market rate units and nearly no affordable units.
There is a very large peer reviewed research literature that makes it clear that the premise of this column is false.
See https://www.fanniemae.com/research-and-insights/do-new-housing-units-next-door-raise-your-rents#:~:text=This%20analysis%20shows%20that%2C%20after,new%20building%20in%20the%20community
The author needs to rely less on their intuition and more on some actual evidence.